Popular BitTorrent search website Isohunt has agreed today to shutdown all of its operations worldwide after losing its legal battle against the MPAA (Motion Picture Association of America). The company, founded by Canadian Gary Fung, has also agreed to pay the movie studios that sued it US$110 million.

The decade-old website was founded by Fung in January 2003 but has been facing legal issues with the film industry since 2006, when the MPAA alleged that it was encouraging copyright infringement on a massive scale. Fung argued that he was protected by the DMCA's safe harbor policy, which limits internet services' liability for what passes through their networks, and was successfully used as a defense by video sharing website Veoh in its trial against Universal Music.

Unfortunately, a US federal judge and a panel of appeals judges didn't agree with Fung, and stated that he had "induced" others to infringe copyright. Fung had "red flag" knowledge that there was infringing content on his sit and stated that he promoted the fact that popular TV shows and movies were there to get more ads.

"[This settlement] sends a strong message that those who build businesses around encouraging, enabling, and helping others to commit copyright infringement are themselves infringers and will be held accountable for their illegal actions," MPAA chairman Chris Dodd said in a statement.

In a goodbye statement posted on Isohunt's website, Fung wrote,

"To quote Breaking Bad, am I "in the empire business", subverting the establishment? No, we are in the culture business. Culture, distilled into digital files, shared by people, on the Internet. In the culture business, there are creators, and there are consumers. In this age of "broadcasting yourself", we are often both creators as well as consumers. And in my ideal world, consumers will share what they want, freely, and creators will be promoted accordingly and compensated fairly. Minimal friction, and minimal middlemen in the way who doesn't help in connecting consumers directly with creators."